OK.KEP.JLG HUNG KUNG.
THU 07 MAY 92 15:33
PG.23
DRAFT
5.
In March 1992
Hyundai indicated that it was
unlikely that its Iraqi receivables and promissory notes would
be paid at least within the next six months.
6.
that a
Subsequently the Hong Kong Government suggested
guarantee by core companies (as offered originally by Hyundai) be signed and that a letter of credit be established
in Hong Kong in order to meet the Government's need to be satisfied that the company could in fact meet Government's listing requirements.
7.
By its letter dated 10 April 1992, Hyundai declined both requests.
8.
As is normal for such tenders, the Government has given Hyundai every opportunity to put its financial position in order. The ultimate requirements were made in an
honest attempt to put it in a position where the Government could have confidence that its financial position would not
cause a high degree of risk that it would default on this important contract. Hyundai has requested the Government to
consider accepting its original accounts as evidence of sufficient capital to complete the project. To do
do so, the
Government would have to accept bad debts from the Middle East as evidence of sufficient working capital. This is not
acceptable to the Central Tender Board.